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Tuesday, September 04, 2012

Thirteen PERCENT

Food stamps in June (SNAP) cost 6.21 billion. Total grocery store spending (which includes a lot of non-food items) in June was 47.552 billion. That means that of all the food bought at grocery stores, at least 13% of it is being bought with food stamps.

Comments:
I wonder if food shelf stocks are included in the number. The stock that the shelves purchase from donated money and grants must be a significant amount these days. The ordinary donations of food would probably count in the surveyed number.
 
It's not so bad as all that, as SNAP is used at walgreens-type stores and can be used at some other retailers as well. There's about 70 or so billion in SNAP-eligible spending for June, so SNAP probably doesn't reflect that much grocery spending.
 
In some states, SNAP can only be used for food purchases.
 
Yes, but stores other than grocery stores sell food that is SNAP-eligible. There's also stuff like take and bake pizza places that sprung up expressly due to SNAP restrictions on prepared foods.
 
Given that 16% of the population is now on food stamps, the surprising thing is not the amount spent on SNAP purchases; it's that the amount spent by non-SNAP purchasers is so close to that spent by SNAP purchasers. It implies that everyone is spending roughly the same amount on food - not much differentiation between upper class and lower class. That says some really bad things about either what's being purchased on food stamps, or how squeezed the people not on food stamps feel.
 
I vote for how squeezed the people not on food stamps are. My grocery purchase yesterday was 2 quarts whipping cream, 2 large containers of cottage cheese, one bottle of light olive oil. That was $22 at Safeway. That was roughly an hour and a half's pay for me. I've had this discussion with well dressed elderly people who are appalled at prices and dealing with it on a fixed income. (And also likely getting less than 1% on any investments.) It will only get more expensive, especially if we get another four years of Obama.
 
I see your Thirteen PERCENT and raise you to Thirty-five PERCENT.
 
Mark, the difference is you're counting paychecks and I'm counting mouths.
 
Who Struck John,

Mark, the difference is you're counting paychecks and I'm counting mouths.

I just want to be clear here. I am indeed counting paychecks but I'm definitely not counting *on* paychecks.

It's a not-so-subtle distinction.

My chart has the potential to go paragolic someday if the numerator (food stamp particiipation) continues to grow and the denominator (nonfarm payrolls) shrinks.

Won't that be a hoot.

As you said earlier, this *is* National Gallows Humor decade. I couldn't add a laugh track here though. It's just too depressing.
 
Paragolic? I think I made up a new gallows humor word. Sigh.
 
One of my former jobs was to inspect stores for SNAP eligibility. I did everything from large chain groceries to gas stations with the bare minimums of stock.

There are quite a few fast food places (especially fish joints) that will sell you a given amount of raw fish, fries and other sides. Then they collect a token fee (usually $1) to cook it for you. It's the same with take-n-bake pizza.

Swipe the SNAP card, collect the dollar in cash, and your order is the same as the guy ahead who paid all in cash--except the taxpayers paid for yours.

To be eligible, the store has to have a display of the raw food. I'm pretty sure no one ever checks to see if the displayed food is ever actually prepared for a specific customer.
 
WSJ - that's my takeaway. The average consumer has to be very pressed to cover basic bills for those statistics.
 
Specifically, because at least 10% of grocery store purchases aren't food, I find the near match extraordinary. Even if one accounts for higher income individuals spending more in restaurants, we should not be seeing this.

One of the predictive methods I rely on to attempt to assess by induction when a lot of "give" has fallen out of the economic system, and for this to be true, many non-food households must be operating on a very slim margin.
 

We have a lot of hipster friends and acquaintances. I have noticed over the last few years how the food at our occasional potluck get-togethers has sort of declined in price, while increasing in prep time. It used to be all fresh, organic lumps of fish or veggies prepared minimally. Now there's more often some cheaper meats, and home-baked goods or veggie salads.

I don't really know much about their finances, but most of them have well-paying jobs.

It looks to me like they're going through the same process my wife and I did in 2008--completely re-organizing our meal plans to reduce our spending on the volatile elements like meats and fresh produce. If the price of our weekly pork shoulder doubles, it's not as big a deal as it would be if we were eating beef sirloin regularly.

 
There are a significant number of households where the primary wage earner is working full time and the household is still eligible for SNAP; based on federal income guidelines. So SNAP usage is a measure of failure of wages to keep up with price increases, rather than a measure of unemployment
 
Scott, unemployment should often be read as underemployment.

Supervalu closing 60 stores.
 
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